A return to a sense of normalcy post-COVID became evident during the second quarter of 2022. It was expected that the rapid growth of online retail would naturally slow down after the COVID-19 restrictions were lifted.
What took everyone by surprise, however, was the unexpected emergence of an “inflation pandemic,” characterized by:
- Rising prices
- Increasing interest rates
- A shrinking housing market
- and a decline in real wages
In response to these economic challenges, New Zealanders chose to reduce their online spending for the remainder of 2022. As a result, the total online spending for the year amounted to $6.07 billion, marking a 4% decrease from the peak levels seen in 2021.
Online purchases accounted for 11% of the overall retail expenditure, with 73% of those transactions originating from New Zealand-based online businesses.